The revelation came as ministers
pledged to rush through laws to reverse the ‘bizarre’ ruling, revealed
in yesterday’s Mail, which tears up 25 years of legal precedent and puts
a straitjacket on officers’ ability to question suspects.

As a result of the ruling, made by a
district judge earlier this year, time spent on bail now counts towards
the maximum of 96 hours suspects can be held in custody.

Previously, the clock stopped when
alleged offenders were let out, allowing police to investigate then
recall them for further questioning weeks or even months later.

The ruling also undermines key public
protections such as requiring alleged offenders to hand over their
passports, or demanding they stay away from schools or victims.

Yesterday Home Secretary Theresa May
branded the ruling ‘flat wrong’. Pledging to introduce laws to reverse
it, she said: ‘This judgment could have a serious impact on the vital
work the police do to keep us all safe.’

The Daily Mail story exposing the scandal

Scotland Yard boss Sir Paul Stephenson said he feared the crisis could saddle taxpayers with a massive compensation bill.

Senior officers estimate more than
85,000 people are on bail at any one time and many will have been bailed
beyond the 96-hour limit.

There are 14,029 on bail in London alone, including 175 suspected of murder or attempted murder.

Sir Paul said: ‘The ruling overturns
25 years of police interpretation and application of the Police and
Criminal Evidence Act. We are very, very concerned.

‘We have been advised by two QCs that this is a serious situation that needs primary legislation to get us out of it.

'We are putting into place
categorisation plans, profiling the most serious offences when people
are on bail. We are in new territory here.’

Fury: Sir Norman Bettison, Chief Constable of West Yorkshire Police, left, said they were 'on the verge of disaster' following the Magistrates' Court decision upheld by Mr Justice McCombe, right, in the High Court

Asked about potential compensation
claims, Sir Paul said: ‘You would expect me to assess the implications
but it is not my intention to alert people to this latest ruling to
behave improperly. The implications are serious for ongoing cases and
historic cases.’

Experts said defendants could use
Article 5 of the Human Rights Act – which protects against infringement
of liberty – to make a compensation claim. It is already used by
prisoners to claim more than £100 a day if they are kept in prison
beyond their parole date.

Tory MP Priti Patel said: ‘This is an
urgent situation that clearly the Government understands has to be
addressed. First to make sure that the criminal justice system doesn’t
go into meltdown, but also that ensures the floodgates aren’t opened to a
string of compensation claims.

Concerned: Home Secretary Theresa May said Government was looking to appeal the decision which could have huge ramifications for the criminal justice system

In a statement to the House of
Commons, Policing Minister Nick Herbert said emergency legislation will
be introduced within days to ensure police were not forced to operate
with ‘one hand tied behind their back’. He insisted ministers were not
alerted to the ruling until this week.

Yesterday the Supreme Court agreed to
emergency sessions to examine the case next month, but it is likely the
law will be changed before MPs go on holiday on July 19.

The decision does not apply to terror
suspects, who cannot be bailed. Under separate counter-terror
legislation, alleged terrorists can be held for a maximum of 14 days
before they must be charged. Until this year the maximum detention
period was 28 days.

On April 5 at Salford Magistrates Court, District Judge Jonathan Finestein rewrote the rule book. Refusing to extend custody time for a murder suspect, he ruled that the detention clock continues to run while the suspect is on bail from the police station.

Paul Hookway, 47, had been arrested over a ferocious attack on Malcolm Short, 52, who lived alone. He was first held last November for 28 hours and then released on bail.

Police applied to the court to extend the period of detention from 36 hours to the maximum allowed of 96 hours. The ruling was made despite Hookway’s solicitor not opposing the extension.

Court papers suggest the judge initially decided the police’s case was ‘justified’ before changing his mind on the advice of his court clerk. Hookway has not been charged and will remain free unless new evidence emerges in the case.

Greater Manchester Police applied to the High Court for a judicial review but last month Mr Justice McCombe upheld the decision and refused leave to appeal.